Under the list of fun things you can do with your time, banking probably doesn’t make the cut. Most people find managing their money and following their finances to be the definition of tedium.
Boredom is a word few people would associate with Generation Z, yet this upcoming and coming demographic has their mind on their money more than most. This unusual focus on finances and their predilection for digital streams makes them primed and ready for FinTech banking.
Let’s explore two of the top reasons why Gen Z are ready more than any other generation to take advantage of this emerging industry.
#1. It’s a Faster Way to Bank
According to the Pew Research Center, the oldest of Gen Z was born in 1997. That’s the same year Google launched its search engine. This factoid isn’t here just to make you feel old. This timeline puts into perspective their relationship with technology. While Millennials were young when tech evolved, they’re still old enough to remember a life before the Internet. Gen Z didn’t just grow up alongside tech, there was never a time in their life when they couldn’t Skype with someone on the other side of the world; they’ve always been connected, and this has informed the way they interact with services.
Though 2.1 million people still use dial-up to access the Internet, most of these browsers aren’t members of Gen Z. They’re more likely to use 4G (and soon to be 5G, the next generation of wireless tech) because they’re used to a constant stream of information.
At any given time, they expect to be able to check in with friends and influencers on social media before switching to news sites and FinTech apps. And they expect for these apps to keep up. According to an IBM study, 60 percent of Gen Z won’t use an app or visit a website that doesn’t load quickly.
FinTech taps into this always connected perspective because of their history and their size.
- Fintech’s history: Found where the financial and tech worlds intersect, FinTech has always been involved in online or mobile solutions. FinTech is the reason why the country’s biggest banks now offer money management apps or mobile banking apps today.
- Fintech’s size: Though there are 27 FinTech companies with unicorn status, the vast majority of companies sporting the FinTech label is small ventures. Even the most successful FinTech enterprises pale in comparison to the world’s largest retail banks. While their smaller size can make it harder to break into targeted markets, it does make it easier to update their services, patch bugs, and customize customers’ online experience faster than these larger institutions — all things appeal to Gen Z consumers looking for a fast, personalized experience.
#2. It Offers Straightforward Services
Gen Z is dialed in but don’t let their preoccupation with their phones confuse you. They’re a pragmatic generation that values financial security. The oldest members would have been 11 at the time of the 2008 recession. They grew up during an economically trying time, and they watched their parents and older siblings struggle to earn a living after the housing market crashed.
They may have been young, but they were paying attention. In the report, the analytical research firm, Raddon, found Gen Z to value financial literacy and responsibility more than any other generation. Even though some of them are just a third of Millennials’ age, more than one-third of Generation Z have enrolled in a financial class compared to just 12 percent of Millennials.
In their search for practical financial solutions, Gen Z prioritizes services that offer clear and uncomplicated terms and conditions. Transparency is one of the biggest features of FinTech services. Whether it’s a company like Chime that offers mobile banking or a company like MoneyKey that offers personal loans online, they use simple and straightforward language to explain rates, terms, and conditions. These services offer uncomplicated access to no-fee checking accounts and personal loans.
As the youngest cohort of defined generations, Gen Z has a lot of growing up to do. They’re on course to mature alongside FinTech — an industry that’s equally young. New and exciting, FinTech offers a refreshing way to bank, but it’s not just fluff — there’s substance, too. With fast, convenient, and simple services, FinTech provides a better way to bank for digital natives like Gen Z.